Credit Card Direct Mail Offers Decline

Posted on August 19, 2008
Filed Under American Express, CitiBank, Credit Card News, Discover, Discover Card | Leave a Comment

The number of credit card offers mailed to Americans has declined for the third consecutive quarter, according to new research from Mintel Comperemedia. Estimated acquisition mail volume for credit cards fell nearly 8% from Q1 2008 to Q2 2008 (from 1.67 billion to 1.54 billion). Credit card direct mail sent to obtain new customers has declined steadily since Q3 2007, when Mintel Comperemedia estimated total volume reached 1.86 billion pieces. The mail volume estimated for Q2 2008 represents a 17% decline since Q3’s high.

“Undoubtedly, this is a symptom of the global credit crunch,” comments Lisa Hronek, senior analyst at Mintel. “Record losses from the subprime fallout and rising delinquencies have squeezed issuers’ credit so tight, they’re tapping out. Add that to the fact that consumers’ credit is already stretched and you’re left with a tough market for credit card issuers.”
Hronek points out the need for new marketing strategies, which she’s seen from leading companies. “Cutbacks in direct marketing are part of financials institutions’ plan to ride this through. We see notably less credit card and mortgage offers as companies figure out key messaging, services and products for today’s anxious, weary consumer.”

Mintel Comperemedia data shows some top financial institutions cutting back across the board, while others realign their acquisition marketing efforts. In the past year:

— Discover and Citibank both cut credit card mail (by 18% and 31%, respectively)
— Bank of America held steady on credit card mailings and boosted its mortgage and loan promotions by 26%
— Capital One and Chase also maintained credit card mail volume, but each cut lending offers (by 26% and 33%, respectively) while increasing banking direct mail (by 80% and 60%)
— HSBC reduced credit card, banking and loan mail volume across the board, sending 52% less offers overall
The Federal Reserve’s latest report on the credit crunch shows problems bad and getting worse. From the Fed’s survey of 52 major banks, only one said it expected to ease lending standards in the next 12 months.

About Mintel
Mintel is a leading global supplier of consumer, product and media intelligence. For more than 35 years, Mintel has provided insight into key worldwide trends, offering unique data that directly impacts client success. Mintel Comperemedia is a competitive media monitoring service that analyzes direct mail, email and print advertising trends. With offices in Chicago, London, Belfast, Sydney, Shanghai and Tokyo, Mintel has forged a unique reputation as a world-renowned business brand. For more information on Mintel, please visit www.mintel.com.

SOURCE: Mintel

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